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Guide to International Patent Protection

International patent protection has been gaining popularity over the years. Now more than ever, intangible assets such as patents have never been more important. As businesses continue to expand their market reach, patent protection has been one of the most important assets that jump-start their success abroad.

It is worth noting, however, that the journey of obtaining patents abroad can be costly. There is also no such thing as an international patent that you can use or enforce in other countries. But, there are several ways to obtain international patent protection.

Direct Filing

The direct route of obtaining an international patent is recommended for applicants with a tight budget. It is best for those who are interested in obtaining patents for only a limited number of countries.

The direct or Paris route allows applicants to file their initial application in their home country. Afterward, they have a 12-month period wherein they can file a patent application abroad. The countries where they filed the application would be the one to determine whether they are eligible for patent protection.

For instance, a US applicant wants to obtain a patent in his only two niche countries. Using the direct route, he would have to file a patent application to the United States Patent and Trademark Office (USPTO) first. Upon application, he then only has a 12-month period to file the application for the two countries where he wants to market his invention.

Patent Cooperation Treaty

The Patent Cooperation Treaty (PCT) facilitates the applicant’s international patent application. It streamlines the initial filing process by buying the applicants enough time (up to 30 months) to file for a national phase entry. National phase entry is when an applicant files an application to the country where they want to obtain the patent.

Note that the PCT does not examine an application fully and it does not necessarily grant patents to applicants. Rather, it is one of the routes to take when obtaining patents abroad. In essence, PCT grants an applicant enough time to further develop the patent and examine countries where it would be most suitable to obtain patent protection.

Since there is no such thing as an international patent, the PCT made it possible for an applicant to file one international application in one language and one location. This route is best suited for applicants who are interested in obtaining patents for numerous countries.

To further illustrate, let us take a US pharmaceutical company as an example. The company wants to obtain a patent in 12 countries. They already filed a patent application with the USPTO, but they are still not certain whether obtaining a patent for these 12 countries would be enough or, even, worth the cost. With the PCT route, they have enough time (30 months) to further observe the market behavior of a country, as well as further, develop the invention they want to patent. When they finally decide that they want to obtain protection in these countries, they can  then easily proceed with the national phase entry and file applications for each country. 

The World Intellectual Property Organization summed up the process of obtaining patent protection abroad in the illustration below.

Cost and benefits of obtaining a patent abroad

Having discussed the two different routes, applicants still need to take several factors into consideration before starting their international patent application journey.

1.    Cost

As mentioned above, obtaining a patent abroad can be costly. Since the patent process is associated with several fees (e.g filing fees, translation costs, attorneys fee, maintenance fees, and so on), applicants need to carefully assess their budget and resources.

2.    Enforceability

When obtaining protection abroad, applicants must evaluate whether the country’s patent system is reliable.

3.    Eligibility

Different countries have different patent laws. For instance, software or living organisms are not patentable in other countries as compared to the United States. It is important to have a basic understanding of the patent laws of different countries before filing an international patent protection.

4.    Longevity

Is the invention worth the patent protection? Or will it just be overshadowed by another product in the next 3-4 years? It is crucial to also conduct a market study and weigh its benefits before proceeding to file an application.

5.    Competition

If an invention is most likely the target of infringers, then it might be a good indicator to obtain protection for that specific country.

Overall, it is worth noting that the information set above is merely an overview of the international patent application process. It is still highly advisable to consult and ask for assistance from a qualified patent attorney. They would be able to provide a more strategic approach as well as give more details about the patent application process. With the help of a patent attorney, it would be much easier to navigate through the market of different countries.

Coronavirus impact on Employee Rights

The coronavirus pandemic has had unprecedented impacts on employees’ rights, including the right to health and safety in the workplace and the right to be paid.

If you have been unfairly dismissed or your wages have been cut because you have refused to attend an unsafe workplace, read our more detailed article here.

Despite employers accidentally infringing, or even deliberately ignoring your rights to stay afloat in this chaos, your employment rights have not changed.

Can your employer force you to attend work if you are vulnerable, or a danger to a vulnerable person?

Your employer will be aware of your age, and assuming that they also know if you are pregnant, or suffer from a disability or ill health, then they will be open to proposals for you to work from home where possible or be put on the government furlough scheme. The deadline for new entrants to the furlough scheme (Coronavirus Job Retention Scheme) has now passed (except for parents on statutory maternity/paternity leave).

Your employer could be breaking the law in attempting to make you attend work, even if you live with someone in one of the above categories.

The law in relation to covid-19 is not entirely clear, however, we advise that employers attempting to force employees to attend work could be unlawful as doing so could subject you to one or more of the following;

Furlough Leave

Furlough leave (the Coronavirus Job Retention Scheme) is available to businesses affected by covid-19. The scheme allows employers to let you stay at home, as the government will pay 80% of your salary (up to £2,500 per month) until the end of August. In September, government contributions will be reduced to 70% and further reduced to 60% in October. 

Employers should agree with you in advance whether you are happy to accept only a percentage of your wage, or whether you insist on receiving the full 100% (with no upper limit). Your employer cannot just put you on the scheme without your agreement. However, if you don’t agree, employers can make you redundant. 

More detailed information and tactics for employees can be found in our practical guide on the furlough scheme.

Can you be dismissed for not coming to work because you are self-isolating?

If you refuse to work, your employer could start disciplinary action against you, but legally, they cannot dismiss you. Doing so would amount to automatically unfair dismissal under s.100 of the Employment Rights Act 1996.

An example of automatically unfair dismissal can be found in the case of Harvest Press Ltd & McCaffrey 1999 ILRL 778, despite not relating directly to the coronavirus pandemic.

Our more detailed guide on coronavirus unfair dismissals can be found on here.

Can your employer cut your salary?

As long as employers are justified in doing so, they can make cuts to your salary. Employers asking their employees to take a pay cut is something that we have frequently encountered during the coronavirus. It will be easy for your employer to justify implementing a pay cut, provided that they ask the same of other employees. 

Employers could also give you your notice and another contract of employment including the pay cut. If you do not agree to work under the new contract provided, your employer can terminate your employment once your notice period is over. 

The effects of coronavirus on the self employed

On the 29th of May 2020 the Chancellor announced a second grant for those who are self-employed and have been affected by the coronavirus. 

The first grant was available until 13th July 2020 and was worth 80% of average monthly trading profits, capped at £7,500 total.

Applications for the second grant closed on 17th August 2020 and was worth 70% of average monthly trading profits, capped at £6,570. 

Our article on the government scheme for the self employed outlines the scheme in more detail.

Are you entitled to pay if you are self-isolating due to coronavirus?

If you have been advised by your doctor or other medical authority to self-isolate, or have been experiencing symptoms, you are legally entitled to Statutory Sick Pay (SSP). You can obtain an isolation note online on the NHS 111 website.

If you are not sick yourself and want to self-isolate, you will not be entitled to SSP.

We advise that if you are a vulnerable person, for example with underlying health conditions or old, to obtain an isolation note online on the NHS 111 website, as current legislation does not entitle you to SSP.

Employers must conduct a risk assessment if you are pregnant. If it is deemed unsafe for you to attend work, you can be suspended on full pay. At this point, you will also be entitled to start your maternity leave, as long as it is within 6 weeks of your due date. Further details can be found in the legislation here.

You will be entitled to your usual pay if you can work remotely, as long as your employer agrees to this.

Any concerns that you have should be addressed with your employer to see if you can agree on the best way forward, before taking any action. 

This legislation is contained in The Statutory Sick Pay (General) (Coronavirus Amendment) Regulations 2020.

Are you entitled to pay if your employer tells you to stay off work?

If you have recently returned from a country badly affected by the coronavirus, or have had contact with someone with the virus, your employer will have a good reason to ask you not to attend work. If your employer does this, you will be entitled to your usual pay, as per your contract.

You will also be entitled to normal pay if your employer closes your place of work or reduces your hours. In these circumstances, your employer could put you on the furlough scheme, where the government will pay 80% of your salary whilst you are at home. 

(See S151 Social Security, Contributions and Benefits Act 1992 and S147-154 Employment Rights Act 1996 for relevant legislation)

What are your rights if you take time off work to care for dependents?

On 4th April 2020, the government announced extension of the furlough scheme (Coronavirus Job Retention Scheme) to people with childcare responsibilities due to covid-19 restrictions. Furlough is not an automatic right, so you must still come to an agreement with your employer about this, however, this is great news for parents. 

The automatic rights that you do have are set out in Section 57A-57B Employment Rights Act 1996. This legislation grants you a right to ‘reasonable’ time off work to care for dependents in an ‘emergency’ including circumstances here your dependents’ usual school/carers or other provider cannot operate due to covid-19 restraints. 

Unless you have an insurance policy or your employment contract provides for payment, time off in these circumstances will be unpaid. A ‘reasonable’ amount of time off will depend on your individual circumstances and your employer must consider your case without reference to possible disruptions or inconvenience it may cause the business. 

Undoubtedly the coronavirus pandemic is considered an emergency, so what is considered as ‘reasonable’ is a period of time ongoing, at least, until schools and nurseries re-open. Initially, you should ask for full pay or at least furlough leave.

If you get coronavirus, will you be entitled to sick leave and pay entitlements?

You will be entitled to your usual sick leave and pay entitlements if medical authorities suspect that you may have the virus or you have been diagnosed, just like any other sickness and sickness absence. 

(See S151 Social Security Contributions and Benefits Act 1992)

If you are made redundant due to covid-19 do you still have to be consulted by your employer?

Employers would normally have to consult for a period of 90 days before making over 20 employees redundant. However, during the coronavirus, employers will likely be able to cite ‘special circumstances’ so that this consultation period is compressed and the full 90day consultation is not necessary. In our opinion, consultations will still need to be carried out by employers, but for a reduced number of days. Failure to do so would be procedurally unfair dismissal.

Despite not being defined in statute, employers will also have a duty to consult when making less than 20 redundancies. This consultation period generally includes meetings and an opportunity for you to make reasonable input into the decision.

If you have been laid off due to the coronavirus but want to leave your job, can you choose redundancy?

If you have been laid off for 4 weeks in a row, or for 6 weeks in any 13 week period, you can write to your employer asking them to give you statutory redundancy payment as well as your notice pay. Where your employer does not respond, you will be able to resign and claim for statutory redundancy pay. In doing so, you will have to give notice as per your notice period (the longer period of either your contract or statutory notice period).

Next Steps

Monaco Solicitors have created a free Coronavirus Rights App which may be able to help if you have been affected by any of the situations outlined in this article. This app can provide you with an advice letter as well as two example letters to your employer, for free. 

Monaco Solicitors.

Deposition FAQs, Tips and Tricks

You have been called upon to give sworn testimony via deposition. Thorough preparation on your part is essential. Following are answers to frequently asked questions along with some tips and tricks to make your deposition go smoothly.

DEPOSITION FAQ’s

  • What is a deposition?

A deposition is the process of giving sworn testimony. It is an opportunity for a lawyer to examine a witness or party under oath.

  • Who can be deposed?

Any person (or entity) with knowledge of discoverable information regarding the lawsuit.

  • Why is a deposition important?

A deposition allows a party to:

  • Pin down another party or a witness.
  • Eliminate surprises at trial.
  • Find other witnesses or evidence.
  • Preserve testimony for trial.
  • Evaluate the credibility of the deponent.
  • Obtain information from nonparty witnesses.
  • Preserve testimony of witnesses who may be unavailable at trial.
  • Challenge the testimony of the party or witness.
  • Evaluate the strengths and weaknesses of their case and their opponent’s case.
  • Where will my deposition take place?

Depositions typically take place in the conference room of the attorney for the party being deposed. While there is some bit of maneuvering as to where a deposition will take place, tradition dictates that your deposition is to take place at your lawyer’s office.

Additionally, in Oregon, you can only be deposed in the county in which you live. For example, if you live in Multnomah County and are noticed to appear in Washington County, you may be able to object to the location of the deposition.

  • Who will be in the room?

All parties to a lawsuit and their respective attorneys are allowed to attend a deposition. The deponent (person being deposed) will be present and is also allowed to have their attorney in attendance. There will also be a court reporter and, possibly, a videographer.

  • When are depositions usually taken?

A deposition can be taken at any time after an appearance is due from a defendant in a case, usually 30 days after service of the summons and complaint.

The timing of depositions is also dependent on the case and strategic issues.

DEPOSITION QUICK TIPS

Always tell the truth. Prior to beginning your deposition, the court reporter will place you under oath. Lying or being untruthful will only make a situation worse.

Answer only the question that is being asked. The examiner is not your friend. You are not to volunteer information or help the examiner in any way. This is not the time for oversharing.

Wait for the entire question to be asked before responding. There is nothing worse than doing the lawyer’s job for him – listen to the entire question and don’t answer what you think he is asking.

If you do not understand a question, ask the attorney to clarify it. Again, the lawyer is asking you questions. Do not help him out by guessing at what he is asking you.

Do not ever guess or estimate. What you say in a deposition will follow you for the rest of the case – a poor guess at a deposition may undermine you at trial.

Speak slowly, calmly, and confidently. Be aware that the deposition is likely recorded and can be played back at trial. Regardless of the questioning keep your composure and remain calm.

Do not argue, get mad, swear, or raise your voice. Assume that this deposition transcript will be published on the front page of the New York Times – how do you want to come across to a jury of your peers?

Sit up straight and dress appropriately. You want to be comfortable yet professional. In my experience, dressing the part aids your confidence which leads to a less stressful deposition. In some cases, your deposition may be videotaped and you will want to look pleasant for the jury.

Answer only as to what you know. For example, if you are asked to provide the names of all persons present at a meeting but you cannot remember the names of all parties in attendance, answering “I cannot recall” is appropriate. If you are asked to state the names of all persons present at a meeting that you did not attend the proper response is “I do not know”.

Ask to see exhibits. If an examiner asks you about a document, always look at it before answering questions. Be careful to make sure that the document is accurate – if it is not, say something.

If you need to take a break ask for a break, or nudge your lawyer.

If you make an error, tell your attorney so it can be corrected during the deposition. There is nothing worse than leaving an incorrect statement on the record. Be sure to talk to your lawyer at a break and correct whatever errors there may be. It is easier to fix at the deposition than in the middle of trial.

Never say “never” or “always”. There is always an exception and, if you are too absolute, a smart adverse attorney will find it and undermine your credibility.

Preparation is the key to being an effective witness so make sure that you discuss any areas of concern with your attorney and review all pertinent documents prior to your deposition.

© 9/18/2018 Hunt & Associates, P.C. All rights reserved.

Article Source: http://EzineArticles.com/10010921

BigLaw And Millennials: Peas In A Pod

Almost every day, we see yet another article on millennials; they are examined, poked, and prodded to determine just exactly what they are and why they are not like the rest of us.

I would argue to the contrary. They are just like the rest of us – only better. Millennials represent the hopes and dreams of the generation that came before them. We made them, hence we should already understand them.

Yes, the Baby Boomers (and those just a bit younger) raised millennials in the same way that BigLaw – the world’s biggest and most successful law firms – trains its young lawyers. Like parents, partners teach associates best practices. They are models for what works and what doesn’t. BigLaw creates environments, activities, and committees geared toward pleasing its associates. In more ways than one, partners praise associates, in particular for their adept use of various technologies. In fact, BigLaw continues to offer associates – as a matter of course – the most advanced technology on the market.

BigLaw parents taught their progeny to appreciate time away from work as much (or more) than time in the office. Women and minority lawyers, who had to work longer and harder to get noticed and promoted, taught their boys and girls that everyone should be held to the same standards; their children were taught not to accept anything less. As BigLaw parents of every stripe worked diligently to climb the ladder of success, they taught their children that being the best, at both recreational and academic pursuits, is paramount.

The Baby Boomers expanded BigLaw practice beyond the regional, to the national and international. As their practices grew, they encouraged their offspring to be local and global – as both learners and leaders. BigLaw parents taught independence; their children learned it. And, following suit, BigLaw parents were able to praise their children for yet another achievement.

It should not be a surprise that Baby Boomers created millennials. As in many other endeavors, we did a good job. Studies routinely show that millennials are the most highly-educated generation to date. Some may observe that millennials appear “entitled”, but millennials believe that everyone else is also entitled. They are a generous and giving generation, as highlighted in just about every published report that statistically analyzes millennials. Indeed, the annual Deloitte Millennial Surveys confirm, again and again, that millennials prefer to work with organizations that have a purpose beyond financial gain.

Is it bad that millennials want to believe in the social missions of their employers, rather than simply their professional purposes? After all, some of the work of young lawyers may be entry level or may not provide the most exciting content, and learning to do it well may be an all day and all night proposition. Yes, BigLaw’s Baby Boomers worked 24/7. No, they did not enjoy it. The difference is that (their) millennials were not raised to grin and bear it; they were raised to work hard, add value, and fight for what they believe in.

BigLaw: the challenge is to embrace millennials, to understand and serve their professional goals, and to give them something to believe in. It would be a shame to let all of your hard work go to waste – and to watch as your exquisite peas find another pod to call work, life, balance.

Article Source: http://EzineArticles.com/9943123

The Thin Line Between Morality & Law

If one eats meat, in a place where majority abstain from taking it, would that person be liable to punishment? What if one takes part in a protest for more Democratic space, which has been proscribed by the Government, is that person justified in his/her cause? Are the police justified to kill in the commission of crime so as to protect innocent lives, with many viewing taking of another life no matter the situation as wrong?

The above questions test our very fundamental values & principles as what is considered Immoral by others is legal according to the Laws of the land, and vice- versa.

Thus creating a thin line between Morality & Law, sometimes so thin that is indistinguishable from the other, even some consider them interdependent. But in varying circumstances, the line is clear with each governed by its own values & principles.

According to Collins Dictionary, Morality is the belief that some behavior is right & acceptable and that the other behavior is wrong. In broader terms is a system of principles & values concerning people’s behavior, which is generally accepted by society or by particular group of people.

Then if one eats meat in a place where majority abstains from it due to their beliefs & principles, he/she will be considered immoral. Another example is if one engages in pre-marital sex, in a society where marriage before sex is a taboo, then they’re also immoral.

By committing such taboos are we liable to be punished, is there any basis to punish those who have gone against the accepted norms set by the society. To be fair, these are principles that have guided our society even before our Grandparents were born and served as a yard stick for generations.

According to Wikipedia, Law is a system of rules that are created and enforced through social or governmental institutions to regulate behavior or in broader term a system that regulates and ensures that individuals or community adhere to the will of the state.

Hence, if one takes part in an unlawful protest, no matter how right the reasons are or align with their innate beliefs & principles e.g. agitating for more Democratic space in a country. They will face the full force of the law as enshrined in the constitution and enforced by relevant institutions.

But if one takes meat in a society where it’s a taboo, the person will be wrong according to the society but legally right to the law or engages in pre-marital sex, the situation will still be the same.

In some cases, what is morally wrong in the society can also be illegal, for example in Islamic societies engaging in pre or extra- marital affairs is not only a sin but also illegal with punishment meted in line with the Quran. In such societies, it’s hard to distinguish between Law & Morality as our Moral Compass forms the basis in creating Laws that govern us and enforced by Institutions.

Some have gone further stating the majority of laws passed are indeed guided by our Moral value, which is true, for example what has been considered generally wrong by the society e.g. public nudity can be enacted & passed into law prohibiting such behavior with Consequences if violated.

In such a scenario, there’s no line to distinguish between Law & Morality as they are interdependent and one serve as a basis in the formation of the other. Good examples are countries with State Religion e.g. Islamic countries like Iran, Pakistan where Sharia law based on the Quran forms the foundation of laws enacted by the Government.

But in modern Western Democratic countries, there’s a clear line between Law & Morality and are independent of each other. For example Abortion is a taboo in many societies and laws enacted outlawing it. In the west, the Rationality of Law takes precedence and the mother has the Right either to keep or terminate the pregnancy. Hence emphasis is on the Rights of an Individual than the collective conscience of the Society.

Just as the saying goes another man meat is another man’s poison, in Law & Morality what is considered morally wrong in one society is legally right in another and vice versa. The thin line is what keeps them from clashing with each other in matters of Values & Principles and ensuring a somehow balanced society guided by the Rule of Law.

Article Source: http://EzineArticles.com/9922328

Everything You Need to Know Before You Fill an NGO Online Registration Form

An NGO is a non-governmental organisation that aims to promote the happiness, wellbeing and comfort of the people of a society. Such societies are not dependent on the government. Most often they work on:

  1. Curbing misuse of power
  2. Remove corruption
  3. Protect the environment
  4. Safeguard vulnerable groups
  5. Aid health of women and children

The Vital Need of NGOs

Because an NGO is separate from the support of the government, it can help democracy work better. Mostly, they do so in two ways:

  • Educate the public:

An NGO teaches the citizens of a nation on how a government works, what it is doing for them and how the work affects the people. They provide crucial information about people in power to the average person. Once the public is informed about politicians and companies, they can use the date to make better decisions.

  • A conduit of communication:

Though a democracy allows every person to write to their political representative about their views and opinions, it is not an effective way of communicating. NGOs, on the other hand, speak as the voice of hundreds of people. Therefore, when they weigh in on the decisions made by people in power, they are heard. These organisations are essentially a channel between the layman and the government. A few areas when NGOs can express the views of the public are:

  1. Nuclear energy
  2. International treaties
  3. Constitutional rights
  4. Protection of rights
  5. Fair worker pay
  6. Freedom of speech

Essentially, NGOs work to ensure that officials keep their legal obligations and protect democracy.

How Do NGOs Raise Money?

The first source of income, when an NGO is at the budding stage, is the donations they get from the citizens. But these are not enough to keep an agency running. Since they do not have the financial backup for promotions and advertisements, like other businesses, they look towards the government for funding. A government can offer money to NGOs for a plethora of reasons. A few of them are:

  1. For supplying legal advices to individuals who have been mistreated like in the case of an employer and employee.
  2. For representing special groups of people like those who are specially-abled. The government funds such an organisation because they want to guarantee that every class of citizen has a voice in policymaking. Furthermore, when officials back up such agencies, they get ready data on the opinions and expertise of this segment of individuals which can be used to make better laws.
  3. For keeping a careful eye and oversight on the government itself. These NGOs perform the vital task of making certain that the present government fulfils the promises they made and uphold all laws. It may seem like a counterintuitive reason to fund an NGO, but it is one of the most crucial. People in power have the tendency to misuse it. When there is a body of people checking on each decision you make, the temptation to abuse power is reduced.

When a government funds an NGO, it does so through a third party. This is imperative because giving direct money to an agency can equate to complete control over their decisions. Whereas, an independent body uses impartial criteria to decide who receives the donations.

How and Where to Register an NGO?

There are departments and officers allocated within a government that deal with registrations of NGOs. At present, there is also a society registration online process for which one can opt. Before registration can be done, one has to decide the type of agency it will be:

  1. non-profit organization
  2. voluntary organization
  3. people’s organization

Once the decision is made, the submission of required documents takes place. These would include:

  1. Information on the NGO/NPO Board
  2. The mission statement
  3. Memorandum of Association or Bye-laws
  4. Programmes and projects information
  5. Staff members details
  6. Funding sources and pattern of income and expenditure
  7. report of annual activities such as financial and audit reports
  8. letters of support (references)

The Basic Steps of Running an NGO

After NGO registration fees has been paid and the government recognises the agency, it is time to operate it. Majority of such organisations work on a set framework of five steps:

  1. Get funds from national or international resources to implement the project in the pipe-works.
  2. Hire the correct people to carry out the plan and pay them the required salary.
  3. Attend meetings held by governments and bodies like the Un as a representative of the public.
  4. Sell a product or service or publish works. It is to be noted that this is not done for-profit but to gain some capital to keep the NGO operational.
  5. Leverage all tax-breaks and support the government offers to keep the agency functioning.

Registering an NGO is a massive responsibility, as will be apparent from the information in the article. It is akin to starting a viable commercial trade. There are obligations that need to be fulfilled like finding an office space, creating detail reports of financial records and reporting to the local government with the correct documentation.

The only way to ensure that the registration procedure goes seamlessly is to employ a well-known Tax return filing company like VakilSearch. Their years of experience in the area and know-how will is precisely what is need to get the non-profit organisation up and running in no time. The brains behind the company offer a comprehensive package for registration. Swing by their site to get more information on how to register an NGO or give them a call to start the process now!

Article Source: http://EzineArticles.com/10095549

5 Ways China Can Improve its Trademark Laws

The meteoric rise in the number of trademark applications in China over the last five years is a testament to the power and importance of China as a market for brand owners. In 2012, there were approximately 1.5 million applications filed in China, and by 2016 that number rose to 3.6 million. In 2017 applicants filed 5.7 million new applications[i]. That number dwarfs the 590,000 new applications filed in fiscal year 2017 at the U.S. Patent and Trademark Office, the second busiest trademark office[ii].

Brand owners recognize that in order to do business globally, they need to devise a strategy in China, whether they will offer products or services directly there or not. Part of the reality of this brand protection strategy is a defensive attempt to prevent fraudulent filings by third parties in order to avoid either paying the applicant to get the brand “returned” to the rightful owner or paying steep legal fees for seemingly never-ending legal battles that may not go in their favor[iii]. China is a “first-to-file” country, meaning that rights in a mark are established through registration, not use. The filing date preserves the applicant’s rights in the mark, whether legitimate or not. U.S. business owners wanting to do business in China often find themselves facing a whole host of frustrations not only due to issues such as fraudulent registrations, but also because of other legal restrictions that impose undue burdens on evidence production and bringing claims in court.

Has Chinese trademark law and policy kept pace with China’s ever-increasing importance in the global marketplace for businesses wanting to protect their brands? After new trademark legislation was introduced in 2013, China announced earlier this year that it is considering further sweeping changes to its IP administrative structure and legal processes, including the creation of a single IP agency (the State Market Supervision Administration)[iv]. As part of this process, China has solicited public opinion on potential revisions to Chinese trademark law. Below are five recommendations for modifications to the current legal regime that would benefit U.S. business owners seeking to do business in or with China.

  1. Hire more trademark examiners

While not a change in the law per se, hiring more trademark examiners will help overcome some of the legal pitfalls that come with having too few examiners to keep up with the ever-increasing number of applications. The current wait from time of application to registration can run as long as 12 to 18 months even if no refusal issues, meaning that even though an owner can preserve a filing date, the status of registration and the rights that go with it are in limbo for a long period of time. Without a registration, a trademark owner cannot fight counterfeiters, particularly on sites such as Alibaba, TaoBao, and TMall, cannot record their trademark with China Customs, and will have a much harder time trying to file any type of unfair competition action in courts in China.

What’s more, each examiner gets about ten minutes to examine each application, which includes a determination of conflicts with prior registrations or prior-filed applications, examination of the application formalities, determination of distinctiveness, and examination of the proper identification of goods and services. With so little time to give to each application, the quality of examination is bound to suffer, resulting in frustrated applicants and a large number of registrations on the Register that may not belong there. With extra clutter on the register, trademark examiners are likely to cite these irrelevant registrations against future applicants, blocking their registrations.

  1. Institute a declaration of use requirement after three years

Some first-to-file jurisdictions, such as the Philippines, require the registrant to prove use of the mark in commerce in connection with the goods or services of the registration after three years in order to maintain the registration. This gives applicants the incentive to file applications for marks they actually intend to use, since there is extra cost involved in either submitting the declaration of use or refiling a new application before the third year is up. A lot of the “chaff” on a registry could be removed by instituting this requirement, allowing legitimate brand owners to have more options.

This type of requirement is not without potential downsides, however. Fraudulent filers can easily fake use specimens or declarations, as some have done in the U.S. to try to get around the strict use requirements for registration[v]. It also makes defensive filings more difficult and costly. And, it could add a burden to the trademark examiners who are already overburdened. Nevertheless, in combination with the third recommendation below, adding the declaration of use requirement could help combat fraud by making non-legitimate filing less profitable and more difficult.

  1. Formalize sanctions for lawyers, agents, and other individuals who knowingly file fraudulent applications

There are few if any consequences for fraudulent filers and for the lawyers and trademark agents who knowingly assist them. Monitoring repeat fraudulent filers and formalization of a black list would make it more difficult for trademark squatters to profit from registering multiple famous or well-known trademarks[vi]. Monetary sanctions or other legal consequences along the lines of censure or disbarment from practice before the trademark office for lawyers and agents who knowingly help squatters file the fraudulent applications would also help reduce these types of filings. While it’s certainly possible that clients aren’t always forthcoming with accurate disclosures to their counsel, it’s fairly obvious when someone other than Apple files an application to register the mark iPhone or iPad[vii] that something is not above board.

  1. Make evidentiary procedures more transparent and less onerous for foreign parties

Any foreign lawyer who has ever tried to work with clients to collect evidence to support a client’s opposition or any other administrative or judicial proceeding in China has had moments of significant frustration. Foreign witness declarations are not generally accepted in China Trademark Office (CTMO) proceedings, or are given little to no weight, even if signed and properly notarized. The CTMO does not have any formal guidelines for how to present evidence generated outside of China, and it is unclear as to how it may be treated in a proceeding[viii]. The Trademark Review and Adjudication Board (TRAB) has formalized guidelines to accept documents generated outside of China but requires such documents to be both notarized and legalized[ix]. The legalization process is both time consuming and costly if there are more than a few documents.

In addition, in a proceeding before the CTMO, such as a non-use cancellation proceeding (which is often necessary to try to cancel marks that have been on the Register longer than three years, do not appear to be in use, and are blocking a client’s application), the party bringing the action does not have the opportunity to examine the registrant’s evidence submitted to the CTMO until after the decision has been rendered[x]. The complainant must file a request to review the evidence with the TRAB, and then try to challenge the evidence. The process again becomes more time consuming and costly, which acts as a disincentive to any foreign trademark owner with legitimate claims.

Providing policy guidelines to the CTMO for how evidence should be treated will take some of the guesswork out of the process for foreign parties that need to present evidence from outside of China to support their case. Also, giving the complainant a chance to challenge potentially fraudulent or weak evidence in an ex parte proceeding before the decision is final will allow the CTMO to take that argument into consideration, and perhaps make decisions that will further help to prevent fraudulent or inactive registrations from cluttering up the Register.

  1. Streamline judicial and administrative, and make bad faith a sole ground for invalidation

It is common in opposition proceedings against fraudulent applications or non-use cancellation actions against inactive registrations for the defending party to not respond. In the U.S., the Trademark Trial and Appeal Board may issue a default judgment against the defending party, which can be appealed. However, in CTMO proceedings, the prosecuting party must continue with the case and present arguments and evidence through final determination, notwithstanding the lack of any response from the other side. Allowing for the issuance of default judgments would not only save time and money for the prosecuting party, but also save CTMO resources that are needed elsewhere.

Perhaps the most helpful change that would benefit foreign filers dealing with trademark squatters is allowing invalidation and opposition proceedings to be brought on the sole grounds of fraud or bad faith filing. In the current version of the China trademark law, there is no provision for bad faith as a ground for opposition or invalidation, although it may be considered in conjunction with other claims and as part of the supporting evidence presented[xi].

It is heartening that China is actively examining and proactively modifying its laws, procedures, and policies to reflect the issues and realities faced by both domestic and international brand owners and is addressing the exponentially increasing influx of trademark applications. The evolution of its intellectual property legal framework to match the demands of both domestic and international filers will only help to strengthen its position in the global marketplace.

[i] https://www.lexology.com/library/detail.aspx?g=d03004b3-4737-4513-a49b-d3af0840c944
[ii] https://www.uspto.gov/dashboards/trademarks/main.dashxml
[iii] New Balance learned a hard lesson about not filing an application for the Chinese character equivalent of its mark before using it: See https://www.wilsonelser.com/news_and_insights/insights/2329-chinese_court_stuns_new_balance_with_16_million
[iv] http://www.worldtrademarkreview.com/Blog/detail.aspx?g=209a6df8-bcd7-4dc6-83e4-27bb198f2f89
[v] https://www.wsj.com/articles/flood-of-trademark-applications-fromchinaalarms-u-s-officials-1525521600?mod=searchresults&page=1&pos=3
[vi] Currently, under the 2013 law, the CTMO may put agencies on a blacklist and issue monetary penalties, but do not have to enforce these restrictions. Kossof, Paul, “The New Chinese Trademark Law” The Trademark Reporter Vol. 104 No. 4, July-August 2014.
[vii] https://www.nytimes.com/2016/05/05/technology/apple-loses-iphone-china-trademark-case.html
[viii] Various discussions with local counsel in Beijing, China, 2018.
[ix] Id.
[x] Id.
[xi] Ferrante, Michele, “Strategies to Avoid Risks Related to Trademark Squatting in China” The Trademark Reporter Vol. 107 No. 3, May-June 2017.

How to Get Your Startup Acquired

There are many great reasons to start your own company, including the desire to be your own boss, the desire to make something happen, passion about your product or service, or even the desire to make more money. A successful startup will need the following:

  • A solid sales and marketing plan;
  • High-quality accounting;
  • strong legal team;
  • A great corporate structure;
  • A dedicated managerial team;
  • Healthy financial resources or a solid plan to get them; and
  • Ensuring that best industry practices are followed.

Regardless of the reason for starting your own company, a startup requires many factors to work so the likelihood of success for startups is still relatively low. Many entrepreneurs are satisfied with their startup being acquired (i.e. bought over) by a bigger company, so that they can reasonable profit upon selling their business. In fact, in the global market, American companies are major acquirers of startups and pay more per acquisition than European companies. Like any buying and selling transaction, there are lots of factors to consider before agreeing to let a bigger company acquire your startup.

Potential Buyers

First, it is important to understand what kind of buyers/acquirers you may encounter:

Venture Capitalists

Potential buyers could be venture capitalists (VCs), who want to take your company to a new level. In some cases, VCs offer to just invest in your company, while guiding you to success; but in others, the VCs might ask you to step aside, sell your interest, and give up your job in exchange for a large sum of money. If you elect to take VC money as an investment, your investors will likely point out areas of improvement to increase profits. In the case of most startups, few thoroughly analyze their operation for potential problem sectors.

A Competitor

You may not be the only company in the market for your particular product or service, and might have numerous competitors. A competitor may wish to acquire your startup to capture your customers as theirs, or they may buy your company so they can shut it down to eliminate their competition.

Strategic Buy

A company that your startup supplies to may find it more practical to acquire your business rather than pay you money for your products as its vendor. Alternatively, a company may want to buy your company so that it can sell your products to their customers under their name.

Intellectual Property

Patents, trademarks, and other intellectual property can be highly valuable, and if you have a patented product or a trade name that another company wants, you can be an acquisition target.

Now What?

We’ve identified the different buyers that may want to acquire you, and their possible reasons for wanting to acquire your startup, which is the easy part. The next step is to identify how to make your company visible and attractive to potential acquirers. The following is a list of things you will need to do this:

Those with the Means to Acquire You

When big companies look to expand, they have to decide whether to build or buy. Hypothetically speaking, let’s say that General Mills is looking to add energy bars to their arsenal, which your startup happens to produce. General Mills can always start an energy bar division from scratch, but if a company exists that already meets their criteria, then buying that company may be more cost effective than building one from scratch. If you are setting yourself up as an acquisition target, you need to first identify potential buyers, and then once they have been targeted, you need to get your startup ready.

A Solid Vision

It is important to make sure your company’s vision aligns with your potential acquirer. For example, if Pepsi is the targeted buyer, and they are currently looking to target a healthier market, you should tailor your next big product launch to be for a health-based drink, and not something like Super Sweet Natural Sugar Flavored Tea.

The idea is to look for and attract potential acquirers that are compatible with the products and services of your startup.

An Attractive Product

If acquisition is the main goal, you will need a superior product. An old-school business motto is that to enter a market, you need a product or service that is better, cheaper and faster than the ones that already exist. Today, disruptive is also on that list. Clayton Christensen described disruption as an “innovation that creates a new market and value network and eventually disrupts an existing market and value network, displacing established market leading firms, products and alliances.” Chief examples are Uber and Lyft.

Talent

Sometimes an acquirer can be drawn in by a well-oiled team. A company will consider buying a startup if they know the team is well-versed in the product or service and they can avoid the learning curve that comes with hiring new people.

A Good Story

Another thing in common about startups that are successfully acquired is a great story. That great story can be about how you develop your products, build your company structure, serve your customers, and simultaneously plan for the future. A great story goes a long way in attracting potential acquirers.

Proprietary Technology

Technological integration of your product or service can really boost the chances of acquisition. For example, well-developed app or system that efficiently moves your product or service into your customer’s hands can quickly make you visible to bigger companies looking to expand.

History

Companies with a clean history will have a much better chance of being acquired. A recent CEO looking for financing on Shark Tank was was rejected once the sharks discovered that the company had lost $14 million earlier and had been operating for 10 years without showing a profit.

Joint Value

Finally, position yourself so that you can show how a potential deal will add value to both you and your acquirer. The key is to show the potential acquirer that their purchase will push them towards profitability, while making certain that your efforts and hard work are also rewarded.

This article  was originally posted on UpCounsel

What to Ask Your Attorney About Legal Expenses and Intellectual Property

1. What is the legal team’s background in working with other clients in a similar industry, company size, or stage as a small business owner?

Different industries have different needs. If representing a food-catering business, you will need to know about various local and city permits needed to obtain. If presenting e-commerce businesses, you need to be familiar with internet sale taxes cross state lines. A large company is most likely to require more extensive business, investment, and employment contracts than a startup due to transaction size and risk exposure.

2. What is a realistic budget for legal expenses?

A quarterly, if not an annual, legal budget so small business owners know what amount to set aside.

3. What are realistic timelines for my company’s objectives?

Timeline of legal projects to undertake, their priorities, and how long it takes to accomplish them.

4. What kind of proprietary assets does the company have? Has the company adequately protected its intellectual property?

This is key to understanding fees for budgeting purposes.

5. What is the legal team’s background in working with other clients in a similar industry, company size, or stage as a small business owner?

Different industries have different needs. If representing a food-catering business, you will need to know about various local and city permits needed to obtain. If presenting e-commerce businesses, you need to be familiar with internet sale taxes cross state lines. A large company is most likely to require more extensive business, investment, and employment contracts than a startup due to transaction size and risk exposure.

6. What is the best way a small business owner can protect personal wealth and assets from business risks?

Incorporate the business, treat the business as a separate entity with separate bank accounts, and document important decisions made during the course of the business (such as raising capital, taking on loans, entering into major business contracts) with your business partner. Typically, such documents are known as directors’ resolutions or minutes.

7. What specifically are small business owners most confused about when you first meet with them?

The type of entity to form – LLCs, C corps., S corps., and which state to incorporate.

8. How can quality legal services help a small business grow?

Quality legal services will help a small business grow in two ways. Internally, quality legal services can build a foundation upon which the small business can grow and expand quickly, such as streamlining the process of raising capital, recruitment, awarding of incentive compensation, and creating templates for business contracts. Externally, quality legal services can help small businesses immensely in contract negotiations with Fortune 500 companies, as some of those contracts can be very convoluted. An experienced attorney’s job will be to assist the client in getting favorable terms, protect the client from taking on responsibilities that outweigh the benefits the client will be receiving, while at the same time maintaining a good relationship with the Fortune 500 company with hopes of such Fortune 500 company to further engage the client.

9. How can quality legal services help small businesses save money?

Quality legal services will advise small businesses what’s a necessary legal expense, what is optional. For example, I have a startup client who would like to file 10 trademark applications to cover their products. As their lawyer and knowing they are a startup, my job is to see if there is a way to file fewer applications that will cover just as wide of a scope, or at least to cover the important products.

10. How can small businesses maximize the value of their legal team’s services?

Provide your legal team with adequate context surrounding a legal matter. For example, when asking your legal team to review a contract, it will be helpful to provide your legal team with a bit of history regarding the relationship between the parties, how important the project is to the small business, so the legal team knows how aggressive it should be. Also, it really helps the legal team if the client is very organized and asks focused questions!

11. Should business partners have the same amount of equity in a company? Why or why not?

As long as the equity split does not contribute to a deadlock situation, this should be fine. For example, if only two business partners, a 50/50 split will not be a good idea. However, if there are three business partners, it’s OK to have 33 1/3 split each, as a deadlock situation is not possible.

12. What are the top three things a small business owner should be aware of when purchasing an existing business?

Accurately determine the value, review the business’s tax returns to determine profitability, and if there is any outstanding tax liability, determine why the business is for sale.

This Article was originally posted on UpCounsel

Protecting Intellectual Property: An Easy Guide for Startups

What Is Intellectual Property?

Intellectual property (IP) is a general term for the rights recognized by U.S. law for creations of the mind, including:

  • Patents – rights granted to inventors for novel and useful inventions.
  • Trademarks – rights granted to businesses relating to the branding of their goods and services (company, product and service names).
  • Copyrights – rights granted to authors for tangible expressions of ideas (art, literature, music, software code, architectural plans).
  • Trade secrets – rights granted to businesses relating to their unique and valuable intangible assets (business processes, client and customer lists, procedures, practices, formulae, research notes, market data).

Types of Patents

There are three types of patents that every startup should be aware of:

Utility Patents – According to the USPTO, utility patents are for inventions, “… of a new and useful process, machine, manufacture, or composition of matter, or a new and useful improvement thereof.” Utility patents are for the protection of how an invention is used and works.

Business Method Patents – Business methods are also protectable under U.S. patent law. A business method patent is actually a form of utility patent that protects new methods of doing business, such as those used, for example, in banking, tax compliance, and e-commerce, to name a few.

Design Patents – Design patents, as described by the USPTO, are “Issued for a new, original, and ornamental design embodied in or applied to an article of manufacture.” A design patent, “permits its owner to exclude others from making, using, or selling the design.” A design patent may provide protection for IP when a utility patent is unavailable.

All three types of patents should be considered by a startup as part of its IP protection strategy.

Why Is Intellectual Property Important to a Startup?

If your startup or early-stage business has IP rights, you can:

  • Put the world on notice that you own those rights by registering them with the U.S. Copyright Office or the U.S. Patent and Trademark Office (USPTO), and by using the proper notice symbols on tangible materials that contain your IP (©, ® and Patent Pending).
  • Prevent unauthorized third parties (infringers) from unfairly competing with you by reproducing your copyrighted works, using confusingly similar trademarks on their products, making/selling products similar to your patented products, or stealing your trade secrets.
  • Use your IP rights to generate revenue by (1) directly selling copyrighted, branded, patented, or other proprietary products and services, or (2) licensing your copyrights, trademarks, patents and trade secrets to others in exchange for royalties.
  • Build joint ventures and alliances with other companies to develop and sell new products and services by combining your IP rights with intellectual property owned by your strategic partners.

Important Steps for Startups to Take for IP Protection

1. Engage an IP lawyer

IP rights function like government-sanctioned monopolies, and that exclusivity can potentially make them very valuable. For that reason, intellectual property law is complicated and imposes various requirements on IP owners to claim, protect and preserve their IP rights (and to prevent IP assets from falling into the public domain — i.e., available for anyone to use without the owner’s permission). Your startup will need a reputable lawyer who specializes in IP law to help you devise an effective strategy for managing and protecting your IP, and to avoid the common mistakes business people make that can have serious legal and financial implications.

Because many IP rights depend upon confidentiality (for example, inventions that have been publicized prior to filing a patent application cannot be patented — see the discussion of “EPD” below), a lawyer is the ideal advisor for a startup since lawyers are ethically and legally required to keep all of your communications confidential. A non-lawyer IP consultant does not have strict confidentiality obligations unless you have a contract imposing such obligations.

2. Identify Your IP

Make a comprehensive list of every business idea, invention, new product or service concept (or any improvement or advance to an existing product/service), potential product name, slogan, logo, business process, market or customer niche, or other proprietary idea that you think your startup owns and is unique and potentially valuable. Your lawyer can help you figure out whether these ideas, concepts, inventions, names and business processes qualify as potential patents, copyrights, trademarks or trade secrets.

3. Make sure you own the IP

Before you can determine whether your IP is protectable (including, for example, by registering it in the U.S. or abroad) you’ll need to confirm that your company actually owns the IP (and can continue to own it if things happen in the future):

  • Do your former employers own the IP? If you and your co-founders created the IP for your startup while you were employed by other companies, check your old employment agreements to make sure that your prior employers do not have grounds for a potential claim. If you developed your new business’ ideas during work hours, or while using the prior employer’s resources, you could be at risk.
  • What happens if you and your co-founders break up? The startup should continue to own the IP even if one or more founders walk out the door. You don’t want a former founder setting up an identical competing business. Ask your IP lawyer to draft a simple Intellectual Property Assignment agreement that ensures the company owns the IP even if the relationship turns sour.
  • Have you given away rights in the DIY contracts you drafted? If your startup signed up customers or suppliers before hiring a lawyer (likely to save money), you need to have your lawyer review those agreements. Ask your lawyer to read through all of your existing contracts to make sure that you haven’t agreed to terms that grant more IP rights to your customers and suppliers than absolutely necessary.

4. Research Your IP

Once you have a list of your startup’s significant IP, you need to confirm the extent to which that IP is unique and original (and therefore legally protectable).

Search the patent records on the USPTO’s website to see if your invention (or something very similar) has already been patented. Then do a “prior art” search on the internet to find out if a non-patented version of your invention already exists. If your invention or an essential part of it is already in the patent records or out in the world, you will not be able to patent it.

Similarly, you’ll want to search the trademark database on the USPTO’s website and the internet in general to see if your startup’s potential business and product names are available. If similar names are already in use in the marketplace on similar products (or if similar names have been applied for or registered with the USPTO for similar products), those trademarks may not be available.

5. Avoid Enabling Public Disclosure (EPD)

As mentioned above, confidentiality is crucial for patentable inventions. Once an invention has been “publicly disclosed” by the inventor, she only has a year to file a patent application with the USPTO. The legal concept of enabling public disclosure (which helps determine what level of disclosure starts the clock running) means you’ve publicized enough information about your product to permit someone else in your industry to copy it. Trade shows, demonstrations to potential investors, press releases and articles in trade publications can be particularly risky for triggering EPD if you’re not planning to file quickly thereafter.

Your IP lawyer can help you avoid EPD as you develop and test your product.

6. Pick Your IP Battles

Money is in short supply for most startups, so you’ll want to map out with your IP lawyer what patents, registrations and other IP-related expenditures need to be prioritized over others. For example, you may decide that you will initially seek patent protection only for the company’s primary product, and protect other inventions as trade secrets using confidentiality agreements. Similarly, you may decide to initially register only the company’s main brand name as a trademark. Additional patents and registrations can often be deferred until more funds become available.

7. Protect Your IP from Investors

If are pitching your startup to potential investors in an effort to raise money, you will need to disclose at least some of your proprietary information to them. To avoid any loss of your IP rights, be sure to:

  • Keep careful records of exactly who has been given access to your private placement memo, business plan or slide presentations, and ask the potential investors to (1) confirm in writing, through non-disclosure agreements (NDAs), that they will not copy or share such materials with others, and (2) return or destroy all paper and electronic copies of the materials if they decide not to invest.
  • Distribute paper or electronic copies of your investor materials only to a limited number of pre-screened potential investors and their advisors. The fewer copies in circulation, the better.

8. Protect IP From Employees and Contractors

To prevent employees and consultants who work for your company from stealing your valuable IP assets and disclosing them to competitors (or starting their own businesses to compete with you), you’ll need them to sign NDAs to keep company information confidential, that is, not disclose company information to third parties. The agreements should also include an acknowledgment that all rights to the inventions or copyrightable material created by them while working for your company are automatically transferred to, and owned by, your company. (Your lawyer can draft an employee/consultant agreement template for you.)

9. Protect Your IP Globally

Many startups fail to recognize the importance of protecting their IP rights outside of the U.S. While applying for a patent in the U.S. is the right place to start, startups need to consider an international patent strategy if they believe their inventions will eventually be sold in other countries. As part of that strategy, startups should consider filing an international patent application (with the USPTO, if a U.S. resident) under the provisions of the Patent Cooperation Treaty (PCT.) A patent application via the PCT provides protection in over 100 countries for up to 18 months to allow for patent filings in those countries where protection is sought.

10. Consider a Provisional Patent Application

provisional patent application is a document filed with the USPTO that establishes an early filing date for the subsequent filing for a non-provisional utility patent. It also allows for the applicant use the term “Patent Pending” in documents describing its invention.

Filing for the non-provisional patent must be done within 12 months of the provisional patent application. A provisional patent application requires inclusion of a specification, but is filed without a formal patent claim, oath or declaration, or information disclosure statement.

11. Consider Track One Prioritized Examination

The USPTO’s Prioritized Patent Examination Program (Track One) allows patent filers to expedite the examination and patent issuance process to less than 12 months. Track One prioritization comes at a substantial cost ($4,000 for large entities, $2,000 for small entities, and $1,000 for micro-entities). However, obtaining a patent earlier can provide a startup with several advantages, including a quicker resulting increase in company valuation, and the ability to obtain foreign patents in a shorter period of time.

This Article was originally posted on UpCounsel